Joe Biden’s statement that this will be a “decisive decade” for tackling climate change, made at the recent global summit on climate, and the long line of leaders who pledged ambitious targets to achieve net-zero greenhouse gas emissions, underlined why ESG investing is set to grow exponentially.
We’ve already seen stellar growth in assets in our own PortfolioMetrix Sustainable World portfolios – up around six-fold since December 2019, with a rise of over a third between December 2020 and April 2021 alone.
As our UK Head of Investment, Nic Spicer, mentioned at our ESG webinar last Thursday (29 April 2021) – view here, the investment required to meet the targets set out at the summit are eye-watering. For the UK alone, it will cost around £50 billion a year, while on a global scale, it’s been estimated that the figure to meet the UN’s Sustainable Development Goals is $2.5 trillion…and that’s every year to 2030.
“Greatest commercial opportunity”
The former governor of the Bank of England, Mark Carney, has described the developments as turning “an existential risk into the greatest commercial opportunity of our time”.
Companies and organisations involved in bringing about change are the focus for ESG investing and many that are included in our Sustainable World portfolios are at the forefront of this revolution.
The work that our investment team does to identify, understand and screen funds that go into our portfolios is impressive. They take nothing at face value, adopting a forensic approach to ensure the funds genuinely do what they promise. They are’ greenwash’ sniffer dogs, taking no prisoners and leaving no room for ambiguity.
On the webinar, Nic also mentioned opportunities for advisers who were specialising in ESG investing, citing two organisations that are worth contacting.
One is SRI Services, which has a “Find-an-Adviser” service. Currently, there are only 27 advisers listed across the whole of the UK, so getting on the list is a great opportunity for advisers who are looking to attract ESG-focused clients.
The other is UKSIF. There are currently 78 advisers listed as members and independent advisers form the fastest-growing segment of their membership.
With sustainable investing already growing at a fast pace, the recent targets set by world leaders are set to push this area onto another level altogether.